Correlation Between Dow Jones and Trust Stamp
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Trust Stamp at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dow Jones and Trust Stamp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and Trust Stamp, you can compare the effects of market volatilities on Dow Jones and Trust Stamp and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dow Jones with a short position of Trust Stamp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Trust Stamp.
Diversification Opportunities for Dow Jones and Trust Stamp
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dow and Trust is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Trust Stamp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trust Stamp and Dow Jones is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dow Jones Industrial are associated (or correlated) with Trust Stamp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trust Stamp has no effect on the direction of Dow Jones i.e., Dow Jones and Trust Stamp go up and down completely randomly.
Pair Corralation between Dow Jones and Trust Stamp
Assuming the 90 days trading horizon Dow Jones is expected to generate 5.05 times less return on investment than Trust Stamp. But when comparing it to its historical volatility, Dow Jones Industrial is 9.09 times less risky than Trust Stamp. It trades about 0.18 of its potential returns per unit of risk. Trust Stamp is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 219.00 in Trust Stamp on May 31, 2025 and sell it today you would earn a total of 67.30 from holding Trust Stamp or generate 30.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Trust Stamp
Performance |
| Timeline |
Dow Jones and Trust Stamp Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Trust Stamp
Pair trading matchups for Trust Stamp
Pair Trading with Dow Jones and Trust Stamp
The main advantage of trading using opposite Dow Jones and Trust Stamp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Trust Stamp can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Trust Stamp will offset losses from the drop in Trust Stamp's long position.| Dow Jones vs. Griffon | Dow Jones vs. Western Copper and | Dow Jones vs. Hudson Technologies | Dow Jones vs. Kaiser Aluminum |
| Trust Stamp vs. Infobird Co | Trust Stamp vs. HeartCore Enterprises | Trust Stamp vs. CXApp Inc | Trust Stamp vs. Quhuo |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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